Today’s tickers: XLB, SHFL & HNR
XLB - Materials Select Sector SPDR ETF – U.S. equities are in retreat today after data showing Europe’s economy contracted in the fourth quarter sparked global growth concerns. Shares in the XLB, an exchange-traded fund that tracks the performance of the Materials Select Sector Index, are down 2.2% this morning at $35.89, with all 30 stocks represented in the fund on the decline just before midday in New York. Materials stocks are among those getting hit hardest as the major averages slump to session lows. A large block of put options in play on the XLB may mean one strategist is prepared for the pullback to continue. The purchase of a block of 30,850 puts at the April $35 strike for a premium of $0.92 each may be an outright bearish stance that benefits from an additional 5.0% correction in the sector. In this case, the put buyer starts making money on the position if the price of the underlying pulls back beneath the effective breakeven price of $34.08 by expiration. Alternatively, the trader may be hedging a long position in the underlying shares, protecting against further bearish movement in the ETF through April expiration, while maintaining upside exposure should growth concerns abate. Shares in the ETF are still up more than 10% since mid-December, the trader could be locking in gains, hedging additional turbulence in the near term, under the view that equities will get back on track this spring.
SHFL - Shuffle Master, Inc. – The maker of gaming-entertainment products and technologies popped up on our scanners this morning with call options a-buzz following the release of better-than-expected first-quarter earnings after the close on Monday. Shares today jumped 20.0% to an intraday high of $17.49. More than 3,350 contracts have…
